LayerZero Points to Kelp's Security Setup as Cause of $290 Million Exploit, Links Attack to North Korea's Lazarus Group

LayerZero has attributed the $290 million Kelp DAO exploit to a security configuration issue on Kelp's part, stating that the protocol's single-verifier setup, which LayerZero had warned against, was the root cause of the attack. The attackers, believed to be North Korea's Lazarus Group, compromised two RPC nodes that LayerZero's verifier relied on, and then launched a DDoS attack on the remaining nodes to force a failover to the compromised ones. This allowed the attackers to trick LayerZero's verifier into releasing 116,500 rsETH. The attack was only successful due to Kelp's 1-of-1 verifier configuration, which LayerZero had recommended against in favor of a multi-verifier setup with redundancy. LayerZero has confirmed that there was no contagion to other applications on the protocol and has since brought its verifier back online, but will no longer support single-verifier configurations.